KeNo's Housing and Economic Portal: Friday June 4 Housing and Economic stories

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Bank Bailout Protesters Storm Ireland's Parliament - (www.dailybail.com) Video: Irish Demonstrators Attempt to Bust Through the Gates of Leinster House -- May 11, 2010 -- The fun starts at 00:38. During a massive demonstration against the bank bailouts in Dublin yesterday, a group of protesters attempted to break through the gates of Leinster House, home of the Irish government. Although the attempt to storm the Dáil was mostly symbolic, punches were thrown, heads were cracked and there was, indeed, blood in the streets. The demonstrators are angry about the bailout of the major Irish banks and their bondholders. Under a "bad bank" scheme called NAMA (National Asset Management Agency), the Irish people are expected to be on the hook for €77 billion to purchase the bad loans. That comes to €22,000 per tax payer just to bail out Anglo-Irish Bank. By some estimates, the scheme stands to lose over €15 billion under even the most optimistic conditions. Meanwhile, pensioners, public-sector workers, university employees are facing layoffs and wage reductions. All to protect the feckin' bank bondholders.

Volcker just saved Wall Street's bankers, and now he owns them - (www.tnr.com) Last Wednesday, Arkansas Senator Blanche Lincoln took to the Senate floor and delivered about as fiery a speech as you’ll hear in the chamber, at least on the subject of financial reform. “Currently, five of the largest commercial banks account for ninety-seven percent of the [derivatives market],” she said. “That is a huge concentration of economic power, which is why I am in no way surprised that several individuals are seeking to remove it from the bill.” The “it” these unnamed individuals were bent on removing is a provision Lincoln wrote that would force banks to spin off their derivatives business if they want access to federal deposit insurance and other safeguards. Lincoln stunned the financial world when she unveiled the hawkish proposal last month and promptly pushed it through the Senate Agriculture Committee, which she chairs. (Derivatives are essentially a bet on the direction of financial data, like bond prices and interest rates.) Despite the industry’s furious efforts and the private reservations of many Democrats, the provision had survived repeated attempts on its life, and Lincoln was determined to preserve it. “She upped the ante,” one industry lobbyist told me shortly after Lincoln’s floor speech. “It’ll be hard for her to walk back from this.” As of late last week, there was a very real chance she’d get her way. One derivatives industry lawyer I spoke with told me Democrats were so concerned about appearing to oppose the measure that it would become law unless the leadership stripped it out “behind closed doors.” But then something unforeseen happened: Legendary Fed Chairman Paul Volcker, a hero to Wall Street reformers and scourge of megabanks, penned a letter to Banking Committee Chairman Chris Dodd proclaiming that the Lincoln approach overreached. Volcker was quite possibly the only person in America with the credibility to stop the Lincoln provision—similar pleas from the administration, the Fed, and the FDIC all seemed to fizzle in recent weeks—and it looks like his intervention is having the desired effect. But before the industry rushes to celebrate Paul Volcker as its savior, it should remember why it feared him in the first place.

Little counterfeiter flees country, Big One across street still forging - (www.latimesblogs.latimes.com) A mystery man who fled from LAPD detectives last month from a downtown Los Angeles loft where counterfeit cash and weapons were found remains at large, and officials worry he may have left the country…. The mystery started in late April when a resident at an upscale downtown L.A. high-rise tower smelled fumes coming from a neighboring apartment. Firefighters knocked on the neighbor's door but were denied entry. They called police, who broke down the door of the penthouse just as the man inside was escaping through a back window and down a fire escape with multiple duffel bags over his shoulder. The apartment contained sophisticated counterfeiting equipment as well as a cache of weapons, including an AK-47. Police found stacks of counterfeit $100 bills totaling $15,000 and a camera tripod.They also found a logo that appeared similar in some ways to the CIA logo. His penthouse balcony had a spot-on view of the U.S. Federal Reserve building on Grand Avenue. He leased the $3,400-a-month penthouse, paying in advance with stacks of cash.

How to turn Congress Inc. back to just Congress - (www.washingtonpost.com) What is the biggest scandal of 2010 so far? Allegations of fraudulent misrepresentation from Goldman Sachs? An oil spill that poses a threat to our environment and economy for generations? Mining operators freely ignoring safety violations and treating workers as disposable? Each of these is bad. But perhaps the biggest political scandal is the one that aids and abets these others -- the pay-to-play system that buys up Congress, pollutes our political system with special-interest cash and deep-sixes the kind of bold reform agenda that we voted for and need. The health-care industry has contributed more than $200 million to congressional candidates in the 2008 and 2010 election cycles, according to the Center for Responsive Politics. Is it any wonder that there was no public option in the final bill, or that Medicare isn't able to negotiate lower drug prices for seniors the same way the Veterans Administration does for veterans?

U.S. Home Seizures Reach Record as Recovery Delayed - (www.bloomberg.com) U.S. home foreclosures climbed to a record in April, a sign that government mortgage relief efforts have yet to turn the tide of property seizures, according to a report by RealtyTrac Inc. “Right now it appears that the banks are focusing on processing the loans already in foreclosure, and slowing down the initiation of new foreclosure proceedings as a way of managing inventory levels,” Rick Sharga, RealtyTrac’s executive vice president, said in an e-mail. “We’ll probably see this trend continue for a while.” Bank repossessions rose to 92,432 in April, up 45 percent from a year earlier, Irvine, California-based RealtyTrac said today in a statement. Foreclosure filings, including default and auction notices, fell 2 percent to 333,837. One out of every 387 households received a filing.

Judge Temporarily Blocks Furlough of State Workers - (www.nytimes.com) A federal judge on Wednesday temporarily blocked a one-day furlough of state workers scheduled by Gov. David A. Paterson for next week, reversing a plan that Mr. Paterson has said is necessary to keep the state from running out of money at the end of the month. Judge Lawrence E. Kahn of Federal District Court issued a temporary restraining order against Mr. Paterson, after unions representing state employees and public university teachers filed a lawsuit alleging that the furloughs, approved by the Legislature on Monday, were illegal. Judge Kahn’s ruling (see below) also bars Mr. Paterson from seeking any further furloughs pending a hearing in his chambers, scheduled for May 26. In his ruling, the judge wrote that the furloughs, which could cost roughly 100,000 state workers a day’s pay, would cause irreparable harm if put into effect and that the unions were likely to win their case in court, two conditions for issuing a temporary restraining order.